Portfolio Review

Assuming that you did all you homework and managed your portfolio based on your age and risk profile and you have a diversified investment portfolio. In a volatile world of share trading and investments, this is not a guarantee of making money or success. Now you have to be more professional in managing your portfolio to decrease or even eliminate risks.

For this, you need to periodically check and review your portfolio and make some changes depending upon the market conditions and other internal and external factors. When to review your portfolio depends on the type and amount of securities held in the portfolio. Remember, it is your hard earned money and you just cannot lose it. It is expert advice to constantly monitor your portfolio and make adjustments as the situation demands. In a volatile market you have no option but to closely monitor and act swiftly and intelligently.

How To Make Adjustments in Portfolio

Portfolio Management

Making adjustments doesn’t mean you need to hurry and buy or sell shares. Here are few expert tips and suggestion to help you.

If a stock that you bought earlier had given you your consistent expected results but the price is not going up for some time, don’t rush to sell it off and close your position. Hold the stock. Have patience. The stock will improve when the current unfavorable conditions are gone.

Never sell stocks thinking that you can buy it back when the prices are right. When you do this, you have to pay commission or brokerage to your broker for selling and again for buying. Also you may not be able to decide when to buy back the stock.

Have a diversified portfolio. Invest in different sectors and in different stocks depending upon your fund and risk profile. As experts say – Never put all your eggs in one basket. Diversify your investment to decrease risk.

Rotate your investment across different sectors. If a particular sector had done well in a session, it doesn’t means it will do better again in the next session. There is no guarantee. Think like a
professional investor and not like a trader. Look at sectors where there is less of Extreme Volatility. These are the sectors to target. Book profit from fully valued stocks and reinvest in current and future good “BUY” stocks. You can also consider targeting stocks that are temporarily down for some temporary reasons.

Measure The Performance of Your Portfolio

Monitor and measure the performance of your portfolio twice a month. Compare performance of individual stocks with overall performance of the market. If you have done all your study and research, you can ignore swing of the stock market.